Shanghai has long been a city thirsty for fresh ideas, and today China’s commercial hub has become a magnet for domestic and foreign business schools and students.

The city’s development into a business education hotspot happened quickly. China’s first MBAs were awarded in the mid-1990s, and the first EMBAs later that decade. The country, however, is making up for lost time.

John D. Van Fleet, assistant dean of the University of Southern California Marshall School of Business and executive director of the USC-Shanghai Jiao Tong (USC-SJTU) Global Executive MBA in Shanghai has witnessed a significant expansion in business education in just 10 years.

“It is commonplace here to look at the environment and see this rapidly developing, maturing economy and realise you have got to have people to manage these businesses – and that requires business education,” he says. “That’s a primary reason for the explosive growth and the reason that the ministry and the local government entities have generally been supportive.”

The EMBA participants have changed too. Hellmut Schütte, dean of China Europe International Business School (Ceibs), has seen growth in the numbers of entrepreneurs at his school. “The private sector is becoming more dynamic and there are more people building their own business. Of course, 10 years, 15 years ago, that did not exist,” says Prof Schütte.

EMBA programmes in Shanghai fall into distinct categories according to their target market. Some, such as China’s biggest domestic business school, Cheung Kong Graduate School of Business (CKGSB), Arizona State University’s WP Carey School of Business and Ceibs, focus on Chinese executives, with most instruction in Mandarin – although Ceibs also offers a global EMBA in English.

Others are less focused on the Chinese market, with tuition in English. On USC-SJTU’s Global Executive MBA, only 30 per cent of participants are Chinese citizens. Some 30 per cent live elsewhere in Asia and fly in to take classes, and there are about 12 nationalities in any one class.

Cathy Lin, president of Sheshang Group, a Shanghai-headquartered company that provides management and marketing services to the luxury sector, is taking her EMBA at Ceibs. Her explanation of how she chose a school illustrates how seriously China’s young leaders are taking their careers.

“The main criterion for me was that courses should be practical, inspiring and forward-looking,” she says. “Many of my friends, who are outstanding entrepreneurs, recommended that I enrol here because Ceibs can offer knowledge that is specific to China, but within a broader global context. I wanted to choose an environment where I would really learn something.”

With so many potential clients, western business schools have been keen to start an EMBA with a Chinese partner. “Foreign universities, particularly those in the US, are known to be entrepreneurial in character,” says Gerard Postiglione, director of the Wah Ching Centre of Research on Education in China of the University of Hong Kong. “That’s part of the motivation for setting up education programmes in China, because they have the growing middle class and, from the Chinese side, there are certain advantages to keeping students in the country, getting an international education which promotes innovation and creativity and helps them to be more competitive after they graduate.”

Prof Postiglione believes that the rush to China is not a matter of fast profit for western business schools, but rather that the top schools now simply need a presence in China.

Buck Pei, executive dean for China programmes at ASU’s WP Carey School, says it was a “conscious, strategic choice” to launch in Shanghai and to focus on programmes for executives from the government and state enterprises. “The most important customer in China is the Chinese government. From the impact creation point of view, ASU’s vision has always been that we try to create impact through education and that should transcend national boundaries,” says Prof Pei.

For foreigners, an EMBA in China is an effective way to build a network of connections in the business community, and affords vital insight into Chinese company culture. “We have three who come from Los Angeles in the current class,” says USC Marshall’s Van Fleet. “They are coming here to be a part of this programme because they see their careers as having a heavy China-Asia orientation and it makes sense for them to be studying with people who are working in this part of the world.”

While demand from executives is a key reason behind the EMBA growth, Shanghai’s business school landscape has flourished in a large part because of the city’s forward-looking education commission.

“It’s at the cutting edge of education reform,” says Prof Postiglione. “It’s amenable to Sino-foreign co-operation and more flexible in how it manages to adhere to the laws for [this].”

While Xiang Bing, the dean of CKGSB, argues that a business school really has to be in Beijing, where key decisions are made, if it wants to run a programme that covers China, he agrees that “the Shanghai government maybe has a more welcoming attitude towards foreign institutions”.

Besides offering a wealth of business opportunities, Shanghai is a very livable city for foreigners. In terms of pollution levels, for example, it rates better overall than Beijing. “If you have the largest city in the country, with the top five per capita GDP, that argues for plenty of wealth to invest in education. And this is historically the city of commerce in China,” says Van Fleet. “All of these things lean towards Shanghai being the place that gets the attentions of foreign academic institutions. It worked with us.”

As far as the future, business school leaders are unanimous that, while the EMBA market is competitive, it is far from saturated. They are experiencing no slowdown in their programmes.

“I think in the aggregate EMBA or business education space, there will be double-digit growth for the foreseeable future because there’s so much need in China,” says Van Fleet.

The challenge for the business schools is not finding executives who can fund EMBAs, but choosing those who will enrich the alumni pool, and attracting top faculty members.

“There are not enough good business school professors,” says Prof Schütte at Ceibs. “A good business school professor is someone who is in research and at the same time a first-class teacher. The participants are 40 years old, they pay a fortune to us and are very critical.”